Make Gifts Now

By: Martin M. Shenkman, CPA, MBA, JD

Make Gifts Now: 3 Ways to Beat the Psychological Barriers to Giving

Money Matters Radio – Estate Planning Checklist

By: Martin M. Shenkman, Esq.

Introduction/Overview: You can gift $13,000 per year per person (donee) and pay unlimited amounts direct to schools for tuition and to medical providers for medical care. The gift tax rate this year is only 35%, next year it is scheduled to be 55%. The estate tax may roar back next year with a mere $1 million exclusion and 55% rate above that. So why aren’t more wealthy people making more gifts this year? Folks should be getting aggressive on gifts, but why aren’t they? Economic worries persist. Many use to living on their “income” can barely make ends meet with current low interest rates.

How can we unlock your willingness to make some serious gifts before year end (and no your kids didn’t pay us to write this!)?

Consider the following items?

√ Annuitize: Your financial planner may be able to help you annuitize how you pay out your savings. Instead of living on income, you can take out income and principal planned and calculated to assure that you’ll have enough money to live on until say 95you’re your maximum life expectancy. Whatever is left you can gift.

√ Buy Annuities: Yep, if you actually buy annuities with a portion of your liquid assets you may feel secure enough that you wont run out of money to make gifts.

√ Buy Life Insurance: Buying life insurance as an inheritance may be easier then making gifts. It will give you the peace of mind you’re leaving your heirs a meaningful inheritance then you can spend what you have more freely.

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